Methanex Reports Higher Fourth Quarter 2016 Earnings and Record Production and Sales Volume
VANCOUVER, BRITISH COLUMBIA--(Marketwired - Jan. 25, 2017) - For the fourth quarter of 2016, Methanex (TSX:MX)(NASDAQ:MEOH) reported net income attributable to Methanex shareholders of $24 million ($0.28 net income per common share on a diluted basis) compared to a net loss of $11 million ($0.12 net loss per common share on a diluted basis) in the third quarter of 2016. Adjusted EBITDA for the fourth quarter of 2016 was $139 million and Adjusted net income was $41 million ($0.46 Adjusted net income per common share). This compares with Adjusted EBITDA of $74 million and an Adjusted net loss of $1 million ($0.01 Adjusted net loss per common share) for the third quarter of 2016.
For the year ended December 31, 2016, Methanex reported a net loss attributable to Methanex shareholders of $13 million ($0.14 net loss per common share on a diluted basis), Adjusted EBITDA of $287 million, and an Adjusted net loss of $15 million ($0.17 Adjusted net loss per common share). This compares with net income attributable to Methanex shareholders of $201 million ($2.01 net income per common share on a diluted basis), Adjusted EBITDA of $401 million and Adjusted net income of $110 million ($1.20 Adjusted net income per common share) for the year ended December 31, 2015.
John Floren, President and CEO of Methanex commented, "Methanol pricing increased significantly through the fourth quarter and into 2017 due to solid supply and demand fundamentals, resulting in higher Adjusted EBITDA and earnings during the fourth quarter. Our average realized methanol price was $278 per tonne compared to $236 per tonne achieved in the third quarter. Strong demand continues to be led by methanol-to-olefins (MTO), as two new MTO facilities, capable of consuming over three million tonnes of methanol, built methanol inventory through the quarter and started up at the end of December. We estimate that total demand was 11% higher in the fourth quarter of 2016 when compared to the same period in 2015."
"We achieved record sales volume for the third consecutive quarter, with sales of 2.5 million tonnes during the fourth quarter of 2016. Annual sales volume grew 12% in 2016 versus 2015, to a new annual record of 9.5 million tonnes. Our improving sales volume was supported by record quarterly and annual production of 1.9 million tonnes and 7.0 million tonnes, respectively, both up 35% from the comparable periods of 2015."
John Floren continued, "I am very pleased with the Company's track record of growing our production over the past four years, as the production growth has significantly increased our leverage to higher methanol pricing. In Chile, our fourth quarter production was the highest since the first quarter of 2011. We continue to make progress on securing additional natural gas in Chile and, during the fourth quarter of 2016, we signed a tolling agreement with YPF SA in Argentina through April 2018. We expect the first volume of natural gas under this tolling contract to be delivered in the first quarter of 2017. We continue to be optimistic that our underutilized 1.7 million tonne Chile facilities represent a very low capital cost growth opportunity for Methanex due to the significant progress in developing natural gas reserves in the area."
Mr. Floren concluded, "During the quarter, we paid a $25 million dividend to shareholders. With $224 million of cash on hand, an undrawn credit facility, a robust balance sheet, and strong future cash generation capability, we are well positioned to meet our financial commitments, invest to grow the Company and return excess cash to shareholders."
The information set forth in this news release summarizes Methanex's key financial and operational data for the fourth quarter of 2016. It is not a complete source of information for readers and is not in any way a substitute for reading the fourth quarter 2016 Management's Discussion and Analysis ("MD&A") dated January 25, 2017 and the unaudited condensed consolidated interim financial statements for the period ended December 31, 2016, both of which are available from the Investor Relations section of our website at www.methanex.com. The MD&A and the unaudited condensed consolidated interim financial statements for the period ended December 31, 2016 are also available on the Canadian Securities Administrators' SEDAR website at www.sedar.com and on the United States Securities and Exchange Commission's EDGAR website at www.sec.gov.
Additional Financial and Operational Data can be found on our Financial Reports page
Director, Investor Relations